Cheesecake Factory's Earnings: A Preview

Cheesecake Factory CAKE announces its next round of earnings this Wednesday, February 17. Here is Benzinga's everything-that-matters guide for this Wednesday's Q4 earnings announcement.

Net Income, Earnings, And Earnings Per Share

Earnings and EPS are useful metrics of profitability. Total earnings also known as net income is equal to total revenue minus total expenses. Dividing net income by the total number of shares outstanding yields EPS.

Earnings And Revenue

Analysts are predicting Cheesecake Factory will report a loss of $0.04 per share on revenue of $600.81 million. Cheesecake Factory EPS in the same period a year ago totaled $0.58. Revenue was $694.03 million.

Why Analyst Estimates And Earnings Surprises Are Important

Analysts who cover this company will publish forward-looking estimates of its revenue and EPS each quarter. Averaging together every EPS and revenue prediction that each analyst makes about a company in a quarter yields the "consensus estimates." A company posting earnings or revenue above or below the consensus estimate is known as an "earnings surprise" and may move the stock by a considerable margin.

If the company were to post earnings in line with the consensus estimate when it reports Wednesday, EPS would be down 106.9%. Revenue would be down 13.43% on a year-over-year basis. Here is how the company's reported EPS has stacked up against analyst estimates in the past:

Stock Performance

Shares of Cheesecake Factory were trading at $50.01 as of February 15. Over the last 52-week period, shares are up 21.4%. Given that these returns are generally positive, long-term shareholders are probably happy going into this earnings release.

Do not be surprised to see the stock move on comments made during its conference call. Cheesecake Factory is scheduled to hold the call at 17:00:00 ET and can be accessed here.